-- A Texas company owned by a campaign contributor
and former business associate of President
Bush could profit if Medicare endorses its
drug card program under guidelines set by
legislation the president signed into law
on Monday, according to a report released
yesterday by a research group run by a former
Clinton administration official.
Center for American Progress, whose president
is John Podesta, Clinton's former chief of
staff, pointed out that David Halbert, a longtime
friend and contributor to several of Bush's
campaigns, helped craft the portion of the
Medicare bill that allows seniors to buy discount
drug cards they can use to purchase medicine
from May of 2004 until 2006, when prescription
drugs will begin to be covered by Medicare.
company, Irving, Texas-based AdvancePCS, is
one of the nation's largest pharmacy benefit
management companies and would be well-positioned
to compete for Medicare's endorsement to issue
the discount cards.
officials will decide in April which companies
can issue the discount cards. By then, AdvancePCS
could be owned by Caremark Rx, which in September
announced its intention to buy the company.
That sale could be approved by the Federal
Trade Commission in January. The Fort Worth
Star-Telegram has reported that the sale could
net Halbert as much as $200 million.
White House is supposed to be the people's
house, not the drug industry's corporate headquarters,"
said David Sirota, author of the Progress
Report, which conducted the AdvancePCS review
for the Center on American Progress. "The
president needs to explain why he allowed
his longtime Texas crony and benefactor to
help write key pieces of Medicare legislation
that guarantees nothing for seniors but billions
for his friend's business."
had been an investor in a Halbert-owned predecessor
company to AdvancePCS, called Advance Paradigm,
the center reported. Bush's trust sold his
shares in 1998. Halbert contributed to Bush
campaigns from his 1994 gubernatorial race
through his White House bid in 2000.
House spokesman Trent Duffy said the administration
consulted a wide range of experts in putting
together the drug bill.
not going to be able to say anything about
specific conversations the White House had
in crafting this legislation," said Duffy,
pointing out that no decision has been made
on which companies will distribute the discount
cards. "I will say the president designed
this bill with 40 million special interests
in mind -- the seniors of the United States
could not be reached for comment, but AdvancePCS
spokesman Dale Thomas said: "AdvancePCS is
not going to dignify this with a response."
have been highly critical of the discount
drug cards, complaining that they won't benefit
in this administration would the words 'discount
card' mean seniors get the card while corporations
get the discounts," said US Senator Edward
M. Kennedy, Democrat of Massachusetts.
drug discount card is meant as a stopgap measure
to ease the burden of prescription drug costs
for seniors until 2006. Senior citizens would
pay a maximum of $30 a year for the card.
Medicare recipients would be eligible for
the card. However, the companies, called prescription
benefit managers, would not be required to
pass on all the saving that they might be
able to negotiate from drug manufacturers.
Instead, the law allows firms to pocket much
of the discount themselves, passing a smaller
amount on to consumers.
Blando, a spokesman for the Pharmaceutical
Care Management Association, said seniors
were likely to get healthy discounts. An analysis
in March by researchers at Brandeis University
found that drug discount cards administered
by pharmacy benefit management companies provide
average discounts of 25 percent for generic
drugs and 14 percent for brand-name prescriptions.
called the report "ludicrous," and said many
firms might not even compete for Medicare's
endorsement to offer discount cards, since
costs might exceed revenues from enrollment
is a red herring, a diversionary tactic, but
we're not going to be swayed by it," he said.
story ran on page A3 of the Boston Globe on
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